Google dodges parents' web privacy appeal in class action lawsuit

(Reuters) - Google and Viacom on Monday defeated an appeal in a nationwide class action lawsuit by parents who claimed the companies illegally tracked the online activity of children under the age of 13 who watched videos and played video games on Nickelodeon's website.

By a 3-0 vote, the 3rd U.S. Circuit Court of Appeals in Philadelphia said Google, a unit of Alphabet Inc., and Viacom Inc. were not liable under several federal and state laws for planting "cookies" on boys' and girls' computers, to gather data that advertisers could use to send targeted ads.

The court also revived one state law privacy claim against Viacom, claiming that it promised on the Nick.com website not to collect children's personal information, but did so anyway.

Monday's decision largely upheld a January 2015 ruling by U.S. District Judge Stanley Chesler in Newark, New Jersey. It returned the surviving claim to him.

Jay Barnes, a lawyer for the parents, declined to comment.

Viacom spokesman Jeremy Zweig said the company is pleased with the dismissals and confident it will prevail on the remaining claim. "Nickelodeon is proud of its record on children's privacy issues and strongly committed to the best practices in the industry," he added.

Google did not immediately respond to a request for comment.

Monday's decision is a fresh setback for computer users, after the same appeals court last November 10 said Google was not liable under federal privacy laws for bypassing cookie blockers on Apple Inc.'s Safari browser and Microsoft Corp.'s Internet Explorer browser.

Circuit Judge Julio Fuentes, who wrote both decisions, said that ruling doomed many of the parents' claims against Mountain View, California-based Google and New York-based Viacom.

He also rejected the parents' claims under the Video Privacy Protection Act, a 1988 law adopted a year after a newspaper wrote about movies rented by failed Supreme Court nominee Robert Bork, based on a list provided by a video store.

Fuentes said the law was meant to thwart the collection of data to help monitor people's video-watching behavior.

He said Congress, despite amending the law in 2013, never updated it to cover the collection of data such as users' IP addresses, browser settings and operating settings, and reflect a "contemporary understanding" of Internet privacy.

"Some disclosures predicated on new technology, such as the dissemination of precise GPS coordinates or customer ID numbers, may suffice," Fuentes wrote. "But others—including the kinds of disclosures described by the plaintiffs here—are simply too far afield from the circumstances that motivated the act's passage to trigger liability."

The revived privacy claim accused Viacom of reneging on a promise on Nick.com that said: "HEY GROWN-UPS: We don't collect ANY personal information about your kids. Which means we couldn't share it even if we wanted to!"

Fuentes said a reasonable jury might find Viacom liable for "intrusion upon seclusion" if it found its alleged privacy intrusion "highly offensive to the ordinary reasonable man."